Goal of the Endowment
Our Key Objectives
The endowment has three key objectives: achieve 5% real return, manage risk, and maintain liquidity.
Where does the money come from?
The Williams endowment is a collection of donations that have been made to Williams over generations from generous alumni, families, and friends of the college.
Each one of these donations is governed by an agreement with the original donor as to the purpose of the gift. Many of these funds are given to endow professorships, to support specific academic programs, or to support the financial aid needs of students.
These thousands of gifts are pooled together so that they can be invested in a diversified portfolio—"the endowment." Each gift is invested so that it can support spending for its intended purpose while also growing even further to increase its impact over time. Pooling all of these assets together allows for a single, aggregated pool of capital that provides the critical support needed for the Williams mission.
The Endowment Model: A Durable Investment Strategy
The “endowment model” refers to an investment strategy pursued by investors that have a long-term investment horizon and the objective to produce sufficient returns to support the institution and preserve the endowment’s purchasing power.
Generally speaking, the endowment model includes a large allocation to equity investments (public and private), a diversified portfolio, and an emphasis on alternative assets such as hedge funds, venture capital, buyout funds, real estate, and real assets.
How does this apply to Williams?
To protect and grow the endowment, Williams maintains a diversified portfolio of carefully selected and monitored investment managers across nine asset classes.
The Investment Office focuses on the long-term portfolio, and seeks to rebalance the portfolio when necessary.